Federalization of workers comp – part 4

Today’s post concludes the four-part discussion of the ‘Fedealization of Workers’ Comp’. And we’ll go out not with a bang, but rather a whimper…
There have been a couple of relatively recent developments that appear to have excited some concern that the Feds (e.g. Congress, HHS) are pursuing a plan to insert themselves deeper into work comp.
One occurred in November of last year, as Rep. Lynn Woolsey (D-CA), chairwoman of the Workforce Protections Subcommittee, called a subcommittee hearing on “Developments in State Workers’ Compensation Systems.”
The subcommittee hearing highlighted criticisms of the 2007 Sixth Edition of the AMA Guides to Permanent Impairment and what several witnesses identified as a trend toward shifting costs away from state workers’ compensation systems onto federal medical and disability programs – Social Security Disability Insurance and Medicare – and private health insurance plans. Several folks testified about various aspects of the issue, the hearing concluded, and nothing more has come of this.
I don’t see this one-day hearing before a subcommittee as terribly significant or portentous.
More recently, Sen. Susan Collins, R-Maine, asked the Government Accountability Office to start looking into possible waste, fraud and abuse in federal workers’ compensation benefits.
The federal government pays benefits to about 49,000 federal employees under the Federal Employee Comp Act (FECA).
What got Sen. Collins interested was the news that the U.S. Postal Service was paying workers’ comp to 132 employees who were at least 90 years old — decades after they should have retired. In my admittedly cursory research, I couldn’t find any provision in FECA that ends payment of benefits at a specific age, so this may well be entirely legitimate.
Collins asked GAO to audit FECA and find out how long people stay on the program, how many recipients receive benefits well past retirement age, and how the program compares to state workers comp plans. She also asked GAO to check workers’ comp records against the government’s list of deceased employees and payroll to find anyone who may be “double dipping,” or getting benefits and a paycheck at the same time, or who may still be receiving benefits after death. FECA doesn’t have any caps on how much benefits one can draw, or other cut-off periods, which Collins said makes it especially susceptible to fraud.
I’d suggest that this kind of publicity makes it unlikely anyone would consider the federal system one we should move to.
Finally, the President’s National Commission on the Deficit’s final report mentioned workers comp exactly once, and then only in passing. In a section on medical malpractice reform, the Commission noted that “Among the policies pursued, the following should be included: 1) Modifying the “collateral source” rule to allow outside sources of income collected as a result of an injury (for example workers’ compensation benefits or insurance benefits) to be considered in deciding awards…”
I would draw your attention to the wording, specifically “For example”. I’d suggest this one parenthetical mention of workers comp is not suggestive of any larger agenda.
Conclusion
The various ‘indicators’ that some point to are at best mischaracterizations of separate and very distinct issues – concerns about FECA; single big, one-time problems; coverage for workers employed in extra-state occupations; and/or political maneuvering to help constituents (Libby and Black Lung).
Why there won’t be a major Federal effort to co-opt or insert itself into workers comp:
1. Congress has many, many bigger issues to deal with, and workers comp is most definitely NOT a big issue.
2. There’s no traction for the issue; no political constituency wants a major fix, and folks from both political poles like it just the way it is.
3. Likely determined and motivated opposition from stakeholders
4. No one in Washington wins by reforming/addressing workers comp – and things only happen in DC if someone wins.